Interstate Department Stores, Inc., was an American holding company for a chain of small department stores, founded in Delaware in 1928 .[1] After a very rapid expansion as the result of acquisition and expansion of two discount store chains acquired in 1959[2] and 1960[3] and also two toy store chains acquired in 1967 and 1969, the firm was renamed in 1970 as Interstate Stores, Inc., to better reflect its business.[4] Increased competition and the changes in consumer buying habits eventually led to decreased sales in the late 1960s and early 1970s which forced the firm to file for bankruptcy in 1974. After shedding all of its non-performing units, the firm was able to exit bankruptcy with the entire toy division intact along with a small remnant of the department store division in 1978. The firm was renamed Toys "R" Us upon emergence from bankruptcy.

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Interstate Department Stores was incorporated in Delaware on February 14, 1928, as a holding company to operate twenty-three department stores in the states of Illinois, Michigan, Indiana, New York, Ohio, Wisconsin, Kentucky, and West Virginia. The first stores were obtained by combining the properties associated with the Federman Department Stores and Stillman Department Stores groups. During this process, individual stores kept their individual names, and local management and staff. Leo G. Federman was selected as the company's first president.[5][1] The oldest store had been in operations for 20 years. By August of that year, Interstate had acquired or built four additional stores and had opened the Hill's Dry Goods Co. in Davenport, Iowa, and The Evansville Dry Goods Co. in Evansville, Indiana.[6]

In 1959, Interstate entered the discount department store field by the acquisition of the two-store Los Angeles-based White Front chain in April for $1.6 million[2] and starting of the new discount chain through the opening a Family Fair store in Toledo, Ohio, and Canton, Ohio, in August and October, respectively. At this time, Interstate had 49 conventional department stores[12]

The rapid growth of the Topps chain in the East and Midwest had the unwanted side-effect of forcing many of Interstate's conventional department stores to close when a new Topps discount store was situated within the same community.[13]

By 1968, there were 60 Topps, 28 White Fronts, 32 department stores, and eight toy superstores. In 1970, the stockholders voted to change the name of the company to Interstate Stores, Inc. to better reflect its business at that time since income from the conventional department stores represented a smaller percentage of the overall income for the firm.[4]

In the 1970s, sales dropped and Interstate closed several stores. In 1974, Interstate tried to acquire the variety and discount chains owned by McCrory Stores, but failed. Soon, Interstate filed for bankruptcy.[17] Soon, all White Front stores closed, with most being converted to Two Guys. The one remaining successful division, Toys "R" Us, became the company's only post-bankruptcy core business. In 1978, Charles Lazarus (founder of Toys "R" Us) took over, and the company was renamed Toys "R" Us Corporation. The company was acquired by Vornado Realty Trust in 2005, former owner of Two Guys.

Family Fair was a discount chain that was started in the Midwest by Interstate in 1959 at a time in which Interstate did not have any discount stores east of the Rockies. In the first year, stores were opened in Toledo[18] and Canton, Ohio,[19] and in Louisville, Kentucky, the following year.[20] Interstate initially had big plans to expand this chain, but these plans were quickly discontinued after Topps was acquired in 1960 and all new discount stores that Interstate had opened in the Midwest after that date were under the Topps banner instead of the originally planned Family Fair banner.[21]

The Topps Discount Stores chain was started in Hartford, Connecticut, by Frank Beckerman[3] and Selwyn Lemchen.[22] The first Topps store (30,000 sq. ft.) was opened in Hartford in 1956.[23] A larger second store (60,000 sq. ft.) was opened the following year in New Haven, Connecticut. The second store also include a supermarket section.[24] In March 1960, the ninth store in the chain and the first store in the Midwest was opened in Niles, Illinois, in a shopping complex that included a supermarket and a drug store in which no walls separated the three businesses.[25][26][27] Another Topps was quickly open in Fairfield, Connecticut.[28][29]

By 1960, the chain had 10 stores in Connecticut, New York, Massachusetts, Pennsylvania, and Illinois. Some of the stores were known as Topps Discount City and others as Topps Discount Center.

The rapid growth in the Topps division also cause declines in the department store division and force the conventional department stores to close.[13]

All Topps store were closed by 1974 when Interstate filed for bankruptcy.[17] At the time of announcement of Interstate's bankruptcy, Topps had nine stores that it intended to continue operating and was in process of closing 11 stores after just finishing closing an additional 41 stores.

^ ab"Federman's Forms Retail Holding Firm: Interstate Department Stores, Inc., Organized By Leo G. And Reuben Federman And John Stillman To Acquire Operating Units—Stock Issue Soon". Women's Wear Daily. 36 (38). February 15, 1928. p. 1. Papers were filed at Dover, Del., yesterday for the Interstate Department Stores, Inc., to operate and acquire department stores in Ohio, Indiana, Michigan, Illinois, Wisconsin, New York, and other states now operated by the Federman-Stillman interests it learned this morning. The Interstate Department Stores, Inc., is to act as a holding company for these various stores and is to be headed by Leo G. Federman.Link via ProQuest.

^ ab"Centralized Operation Set At Interstate". Women's Wear Daily. 120 (104). May 28, 1970. p. 40. Stockholders voted to change the company name to Interstate Stores, Inc., a move that Cantor says, more clearly reflects the company's activity.Link via ProQuest.

^"Oversubscribe Stock Of New Store Chain: Interstate Dept. Stores, Inc., 1927 Net $970,957 — Net Sales Put At $17,939,000 — Common Offered At $28.50 Sells On Curb At $38.75". Women's Wear Daily. 36 (42). February 20, 1928. pp. 1–2. The stores involved are located mostly in cities of from 35,000 to 235,000 and carry popular priced line of merchandise. The stores which will comprise the Interstate chain were formerly owned of Federman and Stillman department store groups. The first Federman store was established in Akron, O., about 20 years ago. The stores are all popular priced department stores but do not carry furniture or musical instruments. No sales are made on credit or the installment plan. All the stores have been closely affiliated in the past and the president consolidation will not disturb the local management in any way. Buying will be completely centralized, continuing the present cooperative buying offices.Link via ProQuest.

^"Interstate Chain To Open In Evansville: New Store Gives Group Its 27th Unit — Many Other Locations Under Consideration". Women's Wear Daily. 37 (44). August 22, 1928. p. 2. The Interstate Department Stores, Inc., will open their 27th unit., about Oct. 15. The new store is approximately 68x180 feet and consists of four floors and a basement. Complete lines of general department store merchandise will be carried. The Evansville Dry Goods Co. is the name under which the new store will trade. Hill's Dry Goods Co., Inc., the Interstate chain's Davenport, Ia., unit, will open about Oct. 1Link via ProQuest.

^"Interstate Acquires Unit At Aurora, Ill". Women's Wear Daily. 39 (66). October 2, 1929. p. 20. The Aurora Dry Goods Co., of Aurura, Ill., has just been acquired by the Interstate Department Stores, Inc., making it the 31st unit to be purchased. This will be make four new stores which will be opened this month.Link via ProQuest.

^"Interstate Department Stores, Inc., Completes 1935 Expansion Program: Company Now Operates 40 Units, Five New Stores Having Been Opened This Year—Chain Never Had To Drop A Store — Two Moved To More Desirable Locations". Women's Wear Daily. 51 (93). November 8, 1935. p. 15. With the opening of the new Syracuse and Trenton stores, Interstate Department Stores, Inc., completed its 1935 expansion program. Five new units were exstablished during the year, giving the organization a chain of 40 stores. They are in Marion and Anderson, Ind., and Trenton, N.J. The two other stores in Evansville, Ind., and Syracuse, N.Y., represented removals to larger and more modern quarters.Link via ProQuest.

^"Interstate Department Stores To Open 8 More Low-Overhead Units". Wall Street Journal. May 13, 1959. p. 23. (Subscription required (help)). Interstate Department Stores, Inc., will open eight low-overhead type stores within the next year, Sol W. Canter, president announced. To be known as Family Fair stores, the new outlets marked the second move in recent weeks toward discount-house type operations for Interstate. At the end of April, Mr. Cantor announced the 49-store chain had acquired White Front Stores, Inc. The first new Family Fair store schedule for opening is in Canton, Ohio.Alternate Link via ProQuest.

^Goodman, S. Oliver (January 20, 1967). "4-Store Area Chain Sold to Interstate". Washington Post. p. E6. Children's Supermarts, Inc., a chain of four discount toy stores in the Washington area, has been acquired by Interstate Department Stores, Inc., a New York-based chain. Interstate operates 40 stores under the name of Topps in 11 states in the East and Midwest. Another 22 stores under the name of White Front are operated in California. The chain also operates conventional department stores, but 85 per cent of the gross is derived from discount units.Link via ProQuest.

^"Interstate Stores Buys Children's Bargain Town". Wall Street Journal. April 2, 1969. p. 4. (Subscription required (help)). Interstate Department Stores Inc. acquired Children's Bargain Town Inc., an eight-store Chicago-based discount toy chain, for an undisclosed amount of cash. Children's Bargain Town, 11 years old and privately held until its acquisition by Interstate, will operate under its present management as a subsidiary. Interstate also operates 26 White Fronts discount stores on the West Coast, 60 Topps discount stores in the East and Midwest and 32 department stores.Alternate Link via ProQuest.

^ ab"Interstate's Chapter XI is tops in shops: Interstate Chapter XI is retailing's biggest". Women's Wear Daily. 128 (102). May 23, 1974. pp. 1, 14. So far 41 Topps discount stores have been closed, 11 are expected to be closed by July 1974 and the remaining nine will also be closed. Of its operating units, 25 are department stores, 43 are discount stores and 48 are toy supermarkets.Link via ProQuest.

^"Family Fair Opens 72,000-Sq.-Ft. Unit". Women's Wear Daily. 100 (63). March 31, 1960. p. 48. The first of three self-service Family Fair department stores planned for the Louisville area open here on Wednesday.Link via ProQuest.

^"Interstate Dept. Stores To Register Higher Net". Barron's. July 15, 1963. p. 20. For a time, Interstate opened its own hard sell outlets - under the name Family Fair stores - in the East. Four such units are in operation. However the company abandon the program in 1960 when it took over the Topps discount chain.Link via ProQuest.

^"2D New Haven Unit Slated By Topps For Fall Opening". Women's Wear Daily. 95 (8). July 11, 1957. p. 11. A second Topps discount department store is under construction in New Haven and scheduled to open this fall.Link via ProQuest.

^"Shop Center to Be Opened Wednesday". Chicago Daily Tribune. March 26, 1960. p. d5. A 90,000 square foot shopping center near the intersection of Harlem avenue and Demster street, Niles will open Wednesday. The supermarket will be a National Tea store, Sav-Mor Drug, Inc., Chicago will operate the drug store and Topps Discount Center, Inc., of Hartford, Conn., will have the department section. There will be no dividing walls between the stores.Alternate Link via ProQuest.

^"Topps Sets First Store in Midwest". Women's Wear Daily. 100 (59). March 25, 1960. p. 32. Topps Discount Center, a Hartford, Conn., soft goods discount operation, will open its first Midwestern store in suburban Niles, Ill., in an under-one-roof operation with a food chain and a local drug chain.Link via ProQuest.

^"Apparel Markup Is 25% for Topps". Women's Wear Daily. 100 (62). March 30, 1960. p. 6. This is the ninth unit for the Hartford, Conn., based discount operation, and the first in the Midwest, according to Frank Beckerman, president.Link via ProQuest.

^"Topps to Launch 80,000 Sq. Ft. Unit". Women's Wear Daily. 101 (31). August 16, 1960. p. 17. A Topps Discount City will open on Kings Highway here (Fairfield) at the end of the month.Link via ProQuest.

^"Topp's, Ltd., New Canada Discount Firm". Women's Wear Daily. 105 (3). July 5, 1962. p. 29. A new Canadian-based firm, Topp's Discount Department Stores, Ltd. has formed here. The new firm is not connected in any way with the Topps discount operation of Interstate Stores.Link via ProQuest.